Every good litigator should check the assets of the prospective defendant.
So should every good arbitrator.
In the case of arbitration, an award can be enforced in 157 countries at the time of writing. Therefore, irrespective of where the breach of an agreement or damage occurred, the ultimate award can be enforced in a place where the judgment debtor has its assets.
We acted for a successful businessman who had decided to develop some property for retirement rental income. The contractor he used took some serious shortcuts, to the extent that demolition orders were issued by the authorities over the subject construction at the building site.
Our client had entered into a construction agreement governed by arbitration.
The prospective defendant had taken, as was likely given his approach, other shortcuts including by taking monies from the contract personally, and not just into his company bank account. He was deriving a personal benefit from the arrangement.
We were therefore able to make an arbitration claim not just against the contractor company, but also against the individual who had taken money directly, presumably to avoid creating taxable profit in his company – a decision which would come back to haunt him.
We took the step of assessing the European assets of the Respondent, so that we would know if there would be other enforcement opportunities beyond the Thai assets of the Respondent.
The contract was governed by Thai law. Therefore, the laws relating to third parties and their liability applied.
This demonstrates that a combination of knowledge of the law of arbitration, a good wise arbitration strategy combined with knowledge of the practice of applicable law is essential in being able to provide good counsel on arbitration matters of this type.
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